- Optimism has jumped 16 points, showing that businesses are feeling more positive about the future.
- Barclaycard Payments data for the first half of Q3 shows the average daily value of SME transactions is up 60% compared to the daily average for Q2.
- SMEs are preparing for recovery, with four in five planning to invest over the next 12 months – up from two thirds last quarter.
Sectors that rely on consumer card payments, such as hospitality and leisure, were hit particularly hard in Q2, and many were not able to re-open safely until the start of Q3.These sectors appear to be recovering well, however. Barclaycard SME transaction data for the first half of Q3 has shown consistent week-on-week growth, and the average daily transaction value has risen by 60% compared to the daily average for Q2. However, card transactions for the first half of Q3 remain 13% behind the same point last year, indicating card-taking SMEs have a way to go to match their pre-pandemic performance.
|Measure||Q3||vs. Q2||vs. Q1|
|Business sales pipeline||103 (+16)||87||-31|
|Planned investment||89 (+14)||75||-29|
|Supply chain||121 (+10)||111||-20|
|Legislation impact||91 (+2)||89||-7|
|Cash flow strength||113 (+17)||96||-25|
|Raising finance||100 (+19)||81||-36|
|UK economy prospects||70 (+22)||52||-48|
|Sector prospects||94 (+23)||71||-36|
|Business prospects||108 (+25)||83||-34|
|Business stability||64 (+17)||47||-45|
|NATIONAL AVERAGE||95 (+16)||79||-31|
The percentage of SMEs reporting coronavirus negatively impacted their business has dropped this quarter, falling from 82 % in Q2 to 74% this quarter.While the pandemic continues to cause disruptions, with 60% of SMEs expecting it to have a significant impact until at least the end of September, the future looks more positive – that number drops to just 13% by this time next year. SMEs are also proactive in their own recovery – 80% plan to invest over the next 12 months, with new equipment and technology (32%) and marketing (28%) the greatest focus.
The return to ‘normal’ for SME employeesThe biggest change SMEs have implemented to mitigate the effects of coronavirus is reducing staff numbers (26%), which rises to 47% amongst medium businesses. The top benefit of coronavirus reported by SMEs was also related to staffing – with a third (33%) welcoming the opportunity to improve remote working capabilities. Many SMEs can see life returning to how it was before coronavirus, with 42% expecting a return to ‘normal’ at some point, and a further 31% saying that the reason they won’t return to normal is because they have made small changes and improvements that they intend to keep. Similarly, many SMEs have already started to return to their offices, with 21% reporting that employees worked on the premises throughout lockdown, while 22% began encouraging a safe return to work when easing began in July. Just over one in ten have revealed they will be moving to a permanent working-from-home model and not asking employees to return to the office.
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